Executive Briefings

PLM Provides Much Needed Supply Chain Process Control and Traceability

The global electronics contract manufacturing market is forecast to grow at a CAGR of 5.74 percent from 2012-2016, according to TechNavio analysts. One of the key factors contributing to this market growth is the need for original equipment manufacturers to optimize resources. With the fast-paced product development environment of high-tech electronics manufacturers, creating a closed-loop, traceable collaboration process with their contract manufacturing partners and suppliers is key to product efficiencies, quality, compliance and meeting time-to-market goals.

PLM Provides Much Needed Supply Chain Process Control and Traceability

Surprisingly, sharing information such as product changes or bill of materials among OEMs, CM partners and other suppliers is still a manual process many times. Typically, communication and data sharing processes are managed via emails, phone calls or other manual processes which can result in missing or incorrect information. Lost time, incorrect builds or supplier issues that are a result of miscommunication are costly and become a competitive disadvantage for manufacturers.

The premise of product lifecycle management technology is to automate processes and centralize the management of disparate product data such as: bill of materials, engineering changes, documents, approved manufacturers lists (AMLs) and approved vendor lists (AVLs), quality, training requirements and projects. By providing a holistic view of this information PLM helps to gain better insight into potential risks, costs and opportunities throughout the supply chain while accelerating time to market.

A key challenge for OEMs and their supply chain is keeping all players on new-product development teams in sync with the current state of the product definition. Frequent changes, new work instructions, and updated AVL/AML information all impact development and requires tight communication processes to ensure the changes are implemented and timely.

Supply Chain Traceability and Accountability

Many times with manual processes there is a lack of traceability and accountability. PLM provides a structure to electronically communicate and track information in real time. Automated workflows support a controlled approval process with sign-off alerts and full traceability on all product updates. This process control helps OEMs to more easily identify issues when things go wrong and creates accountability to help minimize the “blame game.”

Without the proper, real-time communication in place, manufacturers can end up with too many of the wrong parts leading to excess and obsolete inventory, not enough of the right parts resulting in shipment delays, or faulty products shipped to customers.

For OEMs with multiple or global manufacturing partners, the supply chain gets even more complex with time zones, language barriers and decentralization. PLM can help minimize these global supply chain issues by providing a single location to communicate information and gain visibility into any product changes.

Data capture begins early on with PLM and allows all stakeholders to see each stage of the design process. With visibility into supplier information at the earliest stages of design, supply chain personnel can perform cost, availability, delivery and feasibility analyses to determine the viability of a product or project.  Early visibility also allows supply chain personnel to begin the relationship and contractual development process with new suppliers/vendors while the product is being developed without having to wait until production is ready.  In addition, using PLM permits procurement groups to update product record data such as costs, lead times, vendor/part statuses, and past supplier performance, thus helping engineering to make better design decisions and reducing redesign costs.

Meeting environmental guidelines such as RoHS (Restriction of Hazardous Substances), REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals), WEEE (Waste Electrical & Electronic Equipment) and conflict minerals, or quality system requirements for the Food and Drug Administration and International Organization for Standardization pose yet another supplier management challenge for OEMs and their supply chain partners. These mandates require meticulous tracking and reporting of product information. By providing a single location to track, manage and report on all of the information associated to a product, including classifying compliant and non-compliant parts/suppliers, PLM helps to meet requirements for compliance in a central system, facilitates the audit process and aids continuous improvement practices.

Quality and Process Control

Manufacturers must constantly evaluate their supply chains (CMs, software developers, vendors, etc.) for quality and compliance. PLM software provides a closed-loop process to help identify issues anywhere in the supply chain with a path to closure. OEMs can capture all issues within PLM and relate them directly to the product records. This delivers the ability to aggregate data from multiple product lines and across all suppliers to produce reports for non-conformance, better isolate problems in the supply chain and improve efficiencies.  With the ability to electronically create Supplier Corrective Action Requests (SCARS), automate follow-up tasks and provide closure with full traceability, manufacturers and their partners can better track, report and analyze this information to help with supplier audits and quality.

In addition, many regulatory agencies such as ISO and the FDA as well as good practice (GxP) standards require a well-documented method of ensuring that manufacturers are performing audits of their suppliers. These audits need to be performed on a consistent basis to guarantee their product quality standards are maintained. PLM systems are built on scheduling engines which enable manufactures to define audit cycles for any given supplier. These automated audit cycles not only remind manufacturers when critical supplier audits are necessary, they also present a structured process necessary for the manufacturers to pass their own internal and external audits.

Adopting an electronic system such as PLM to help manage product and supplier information can be a huge benefit for manufacturers and their supply chain partners. Centralized data that can be accessed in real time can help to eliminate issues such as scrap, rework, assembly delays and supplier risk. Supplying full traceability and formal approval processes that are often lacking with manual processes results in the ability to deliver high-quality, compliant and cost-effective products faster in an increasingly competitive market.

Source: Omnify Software

Surprisingly, sharing information such as product changes or bill of materials among OEMs, CM partners and other suppliers is still a manual process many times. Typically, communication and data sharing processes are managed via emails, phone calls or other manual processes which can result in missing or incorrect information. Lost time, incorrect builds or supplier issues that are a result of miscommunication are costly and become a competitive disadvantage for manufacturers.

The premise of product lifecycle management technology is to automate processes and centralize the management of disparate product data such as: bill of materials, engineering changes, documents, approved manufacturers lists (AMLs) and approved vendor lists (AVLs), quality, training requirements and projects. By providing a holistic view of this information PLM helps to gain better insight into potential risks, costs and opportunities throughout the supply chain while accelerating time to market.

A key challenge for OEMs and their supply chain is keeping all players on new-product development teams in sync with the current state of the product definition. Frequent changes, new work instructions, and updated AVL/AML information all impact development and requires tight communication processes to ensure the changes are implemented and timely.

Supply Chain Traceability and Accountability

Many times with manual processes there is a lack of traceability and accountability. PLM provides a structure to electronically communicate and track information in real time. Automated workflows support a controlled approval process with sign-off alerts and full traceability on all product updates. This process control helps OEMs to more easily identify issues when things go wrong and creates accountability to help minimize the “blame game.”

Without the proper, real-time communication in place, manufacturers can end up with too many of the wrong parts leading to excess and obsolete inventory, not enough of the right parts resulting in shipment delays, or faulty products shipped to customers.

For OEMs with multiple or global manufacturing partners, the supply chain gets even more complex with time zones, language barriers and decentralization. PLM can help minimize these global supply chain issues by providing a single location to communicate information and gain visibility into any product changes.

Data capture begins early on with PLM and allows all stakeholders to see each stage of the design process. With visibility into supplier information at the earliest stages of design, supply chain personnel can perform cost, availability, delivery and feasibility analyses to determine the viability of a product or project.  Early visibility also allows supply chain personnel to begin the relationship and contractual development process with new suppliers/vendors while the product is being developed without having to wait until production is ready.  In addition, using PLM permits procurement groups to update product record data such as costs, lead times, vendor/part statuses, and past supplier performance, thus helping engineering to make better design decisions and reducing redesign costs.

Meeting environmental guidelines such as RoHS (Restriction of Hazardous Substances), REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals), WEEE (Waste Electrical & Electronic Equipment) and conflict minerals, or quality system requirements for the Food and Drug Administration and International Organization for Standardization pose yet another supplier management challenge for OEMs and their supply chain partners. These mandates require meticulous tracking and reporting of product information. By providing a single location to track, manage and report on all of the information associated to a product, including classifying compliant and non-compliant parts/suppliers, PLM helps to meet requirements for compliance in a central system, facilitates the audit process and aids continuous improvement practices.

Quality and Process Control

Manufacturers must constantly evaluate their supply chains (CMs, software developers, vendors, etc.) for quality and compliance. PLM software provides a closed-loop process to help identify issues anywhere in the supply chain with a path to closure. OEMs can capture all issues within PLM and relate them directly to the product records. This delivers the ability to aggregate data from multiple product lines and across all suppliers to produce reports for non-conformance, better isolate problems in the supply chain and improve efficiencies.  With the ability to electronically create Supplier Corrective Action Requests (SCARS), automate follow-up tasks and provide closure with full traceability, manufacturers and their partners can better track, report and analyze this information to help with supplier audits and quality.

In addition, many regulatory agencies such as ISO and the FDA as well as good practice (GxP) standards require a well-documented method of ensuring that manufacturers are performing audits of their suppliers. These audits need to be performed on a consistent basis to guarantee their product quality standards are maintained. PLM systems are built on scheduling engines which enable manufactures to define audit cycles for any given supplier. These automated audit cycles not only remind manufacturers when critical supplier audits are necessary, they also present a structured process necessary for the manufacturers to pass their own internal and external audits.

Adopting an electronic system such as PLM to help manage product and supplier information can be a huge benefit for manufacturers and their supply chain partners. Centralized data that can be accessed in real time can help to eliminate issues such as scrap, rework, assembly delays and supplier risk. Supplying full traceability and formal approval processes that are often lacking with manual processes results in the ability to deliver high-quality, compliant and cost-effective products faster in an increasingly competitive market.

Source: Omnify Software

PLM Provides Much Needed Supply Chain Process Control and Traceability